Khorramdel v Secretary, Department of Social Services
[2013] AATA 848
[2013] AATA 848
Division GENERAL ADMINISTRATIVE DIVISION File Number(s)
2013/0933
Re
Siavesh Khorramdel
APPLICANT
And
Secretary, Department of Social Services
RESPONDENT
DECISION
Tribunal Senior Member A K Britton
Date 29 November 2013 Place Sydney The Applicant’s request to the Deputy Registrar to summon the Australian Taxation Office to produce the requested documents is refused.
..........................[SGD]..............................................
Senior Member A K Britton
CATCHWORDS
PRACTICE AND PROCEDURE — Proceedings — Summons — Whether the Tribunal has the power to summons protected information from the Australian Taxation Office —Whether an exemption to the protection applies — Whether the Tribunal’s general summons power overrides the secrecy provisions of the Taxation Administration Act 1953
LEGISLATION
Administrative Appeals Tribunal Act 1975 (Cth) – ss 37; 40(1A); 40(1B); 40(1C)
Administrative Appeals Tribunal Regulations 1976 (Cth)
Public Service Act 1999 (Cth) – s 7
Social Security Act 1991
Social Security (Administration) Act 1999 (Cth) – ss 196
Taxation Administration Act 1953 (Cth) – ss 995.1; Schedule 1, ss 355-25(1); 355-30; 355-75; 355-55; 355-65; 355-70; 355-75
CASES
Australian Competition & Consumer Commission v Shell Co of Australia Ltd (1999) FCA 212
Cosco Holdings Pty Ltd v Federal Commissioner of Taxation [1997] FCA 1504;
Harris v Commissioner of Taxation [2002] FCAFC 226; (2002) 125 FCR 46
Khorramdel and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs, (Unreported, Presiding Members Smith and Richardson, 24 January 2013)
Rayson and Repatriation Commission [2008] AATA 1063
Re Moore and Military Rehabilitation and Compensation Commission [2006] AATA 425
State Government Insurance Office v Rees [1979] HCA 52; (1979) 144 CLR 549
Technical Products Pty Ltd v State Government Insurance Office (Queensland) [1989] HCA 24; (1988) 167 CLR 45
Trade Practices Commission v Arnotts Ltd (1989) 88 ALR 90
REASONS FOR DECISION
Senior Member A K Britton
29 November 2013
No submissions
These reasons address a request to the Tribunal made by Mr Siavesh Khorramdel for a summons to be issued to the Australian Taxation Office, requiring it to produce various documents.
Mr Khorramdel is the applicant in the substantive proceedings, which relate to a decision to raise and recover a debt as a result of payment to him of Newstart Allowance between 1996 and 2001. An issue in those proceedings is whether, as alleged by the respondent Secretary, throughout that period, Mr Khorramdel received income in the name of “Sivash Kheramdel”. The Secretary contends that the applicant, Siavesh Khorramdel and Sivash Kheramdel is one and the same person. In proceedings before the Social Security Appeals Tribunal Mr Khorramdel denied that allegation (Khorramdel and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs, (Unreported, Member Smith and Member Richardson, 24 January 2013) at [19], [25]). It is unknown whether Mr Khorramdel continues to deny that allegation because he is yet to file a statement of facts and contentions or any evidence in the substantive proceedings.
Background to request for summons
At Mr Khorramdel’s request, in May 2013 the Registrar of the AAT issued to the Australian Taxation Office (ATO) a summons to produce documents. The documents the subject of that summons were described in these terms:
Contact address for Tax File Number: [Number deleted] (Sivash Kheramdel) of financial taxation return for 1997/1998/1999/2000 years. Please specify contact address for each year separately and clearly.
The ATO wrote to the Tribunal advising that it was unable to comply with the summons due to the secrecy provisions of the Taxation Administration Act 1953 (Cth) (the TAA). The ATO explained:
Subsection 355-25(1) of Schedule 1 to the Taxation Administration Act 1953 (TAA 1953) makes it an offence to disclose protected information (as defined in subsection 355-30 of Schedule 1 to the TAA 1953) to another entity (other than the entity the information is about) or to a court or tribunal unless a relevant exception applies. Subsection 355-75 particularly references Courts and Tribunals.
Subsequently Mr Khorramdel, who is self-represented, wrote to the Deputy Registrar of the AAT seeking an opinion about whether it would be open to the ATO to refuse to comply with a summons to produce “all those taxation documents or information [which] exist in [the] case file” (the requested documents). Mr Khorramdel gave as an example of the documents he seeks, various documents lodged in these proceedings by the Secretary under s 37 of the Administrative Appeals Tribunal Act 1975 (Cth) (the AAT Act). All relate to “Sivash Kheramdel” or “S Kheramdel” and were apparently produced by the ATO in answer to a notice issued by the Secretary under s 196 of the Social Security (Administration) Act 1999 (Cth) (the requested documents). The requested documents are broadly similar to the class of documents specified in the original summons.
In these reasons I will treat Mr Khorramdel’s request to the Deputy Registrar for an opinion as a request to issue a summons. As Mr Khorramdel acknowledges, if a summons for the requested documents were to be issued, it is likely that the ATO would again contend that it could not comply because of the secrecy provisions contained in the TAA. In deciding whether Mr Khorramdel’s request for summons should be granted I have proceeded on that assumption.
Statutory framework
Sections 40(1A) and 40(1B) of the AAT Act confer on the member presiding at the hearing, the Registrar, a District Registrar or a Deputy Registrar for the purpose of the hearing of the proceeding before the Tribunal, power to summons a person to appear before the Tribunal at that hearing or a directions hearing, to produce any books, documents or things in the possession, custody or control of the person or persons named in the summons that are mentioned in the summons. The Registrar, a District Registrar or a Deputy Registrar must not refuse a request to summons a person unless the refusal is authorised by a presidential member, a senior member or an authorised member (s 40(1C)).
Should the request for the summons to the ATO be refused?
Neither the AAT Act nor the Administrative Appeals Tribunal Regulations 1976 (Cth) provide guidance on the factors to be considered when deciding whether to exercise the power to refuse a request to issue a summons. The common law principles relating to the issue of subpoenas by a court have consistently been applied in deciding matters relevant to the issue of a summons by the Tribunal. (Cosco Holdings Pty Ltd v Federal Commissioner of Taxation [1997] FCA 1504; (1997) 37 ATR 432; Re Moore and Military Rehabilitation and Compensation Commission [2006] AATA 425; (2006) 90 ALD 417).
Documents sought under summons must have some apparent relevance to the issues in the proceedings, or, put another way, the summons must have a legitimate forensic purpose: Trade Practices Commission v Arnotts Ltd (1989) 88 ALR 90 at 103; Australian Competition & Consumer Commission v Shell Co of Australia Ltd (1999) FCA 212). There is no issue that the requested documents have some apparent relevance to a key issue in the substantive proceedings, namely whether income received by Sivash Kheramdel and declared to the ATO, was in fact income received by Mr Khorramdel.
Secrecy provisions of the TAA
Division 355 in Schedule 1 of the TAA (the Schedule) is headed “Confidentiality of taxpayer information”. The guide to that Division explains
What this Division is about
Disclosure of information about the tax affairs of a particular entity is prohibited, except in certain specified circumstances.
Those exceptions are designed having regard to the principle that disclosure of information should be permitted only if the public benefit derived from the disclosure outweighs the entity's privacy (s 355-1).
Section 355-25 makes it an offence for a taxation officer to disclose protected information to another entity (other than the entity to whom the information relates or an entity covered by subsection (2)) or to a court or tribunal; where that information was acquired by the taxation officer, unless a relevant exemption applies.
“Protected information” is defined by s 355-30 of the Schedule to mean information that:
(a)was disclosed or obtained under or for the purposes of a law that was a taxation law (other than the Tax Agent Services Act 2009) when the information was disclosed or obtained; and
(b)relates to the affairs of an entity; and
(c)identifies, or is reasonably capable of being used to identify, the entity.
The requested documents in my opinion meet each of these criteria. They relate to the affairs of and identify “an entity”, namely Sivash Kheramdel, and were obtained under a taxation law. Accordingly it would be an offence for a taxation officer to release those documents unless one of the exemptions set out in the Schedule applies. Three exemptions are possibly relevant: s 355-55 (disclosure in performing duties), s 355-65 (disclosure for other government purposes) and s 355-70 (disclosure for law enforcement and related purposes).
Does the exception for disclosure in performing duties exception apply?
Section 355-25 does not apply if a taxation officer discloses protected information in performing their duties as a taxation officer (s 355-50).
355-50 Exception--disclosure in performing duties
1Section 355-25 does not apply if:
(a)the entity is a * taxation officer; and
(b)the record or disclosure is made in performing the entity's duties as a taxation officer.
Note 1: A defendant bears an evidential burden in relation to the matters in this subsection: see subsection 13.3(3) of the Criminal Code.
Note 2: An example of a duty mentioned in paragraph (b) is the duty to make available information under sections 3C, 3D and 3E.
2Without limiting subsection (1), records or disclosures made in performing duties as a * taxation officer include those mentioned in the following table:
…
Items 1 and 3 of the Table might be relevant:
Records or disclosures in performing duties
Item
The record is made for or the disclosure is to ...
and the record or disclosure ...
1
any entity, court or tribunal
is for the purpose of administering any *taxation law.
3
any entity, court or tribunal
is for the purpose of criminal, civil or administrative proceedings (including merits review or judicial review) that are related to a *taxation law.
Does item 1 apply?
The Administrative Appeals Tribunal is a tribunal for the purpose of the Act (s 2 of the TAA). The TAA gives “taxation law” the same meaning as that given by the Income Tax Assessment Act 1997 (Cth). Section 995.1 of that Act defines “taxation law” to mean:
(a)an Act of which the Commissioner has the general administration (including a part of an Act to the extent to which the Commissioner has the general administration of the Act); or
(b)legislative instruments made under such an Act (including such a part of an Act); or
(c)the Tax Agent Services Act 2009 or regulations made under that Act.
The substantive proceedings relate to the operation and administration of the social security law. If the documents were produced in answer to the summons in my opinion it could not said be said that their disclosure was for the purpose of administering any taxation law. Therefore item 1 of the Table does not apply.
Does item 3 apply?
The requested disclosure will fall within item 3 of the Table if it is for the purpose of criminal, civil or administrative proceedings (including merits review or judicial review) that are related to a taxation law.
The disclosure is for the purpose of administrative proceedings. The issue to be decided is whether those proceedings could be said to be “related to a taxation law”.
In a legislative context the phrases “related to” and “in relation” are generally interpreted as having the same meaning (See DC Pearce and RS Geddes, Statutory Interpretation in Australia (7th ed, LexisNexis, 2011) at p 375, [12.7]). It is settled that the phrase “in relation to”, absent other indicia, is an expression of broad import (O’Grady v Northern Queensland Co Ltd [1990] HCA 16; (1990) 169 CLR 356; 92 ALR 213 per Toohey and Gaudron JJ) and may require “no more than a relationship whether direct or indirect, between one subject matter and another” (per McHugh J in O’Grady at 376). But as with any statutory expression the phrase must of course be read in the context in which it is found (State Government Insurance Office v Rees [1979] HCA 52; (1979) 144 CLR 549 at 553-554 and 560-561; Technical Products Pty Ltd v State Government Insurance Office (Queensland) [1989] HCA 24; (1988) 167 CLR 45 at 47, 51 and 54; Harris v Commissioner of Taxation [2002] FCAFC 226; (2002) 125 FCR 46).
In my opinion the substantive proceedings could not be said to be “related to” a taxation law. As noted they concern the review of a decision to raise and recover a debt under the Social Security Act 1991 (Cth) said to have been incurred by Mr Khorramdel. Those proceedings do not “relate to” a taxation law. Therefore the requested disclosure could not be said to fall within item 3 of the Table.
Summary
The production to the AAT by the ATO of the requested documents in answer to a summons would not fall within s 355-25 of the TAA.
Does the exception for disclosure for other government purposes apply?
Section 355-65 states:
1Section 355-25 does not apply if:
(a)the entity is a * taxation officer; and
(b)an item in a table in this section covers the making of the record or the disclosure.
Note: A defendant bears an evidential burden in relation to the matters in this subsection: see subsection 13.3(3) of the Criminal Code
Table 1--Records or disclosures relating to social welfare, health or safety
2Table 1 is as follows:
Table 1: Records or disclosures relating to social welfare, health or safety
Item
The record is made for or the disclosure is to ...
and the record or disclosure ...
1
an Agency Head (within the meaning of the Public Service Act 1999) of an agency (within the meaning of that Act) dealing with matters relating to the social security law (within the meaning of subsection 23(17) of the Social Security Act 1991)
is for the purpose of administering that law.
If the ATO were to produce the requested documents to the AAT that “disclosure” would be for the purpose of the administration of the social security law. However the disclosure would not fall within item 1 of the above Table because it only permits disclosure to an “Agency head” namely the Secretary of a Department, the Head of an Executive Agency, or the Head of a Statutory Agency (s 7 of the Public Service Act 1999 (Cth)). In conducting its merit review function the Tribunal “steps into the shoes” the decision-maker relevant agency head, in this case the Secretary of the Department of Social Services, and may exercise all the powers and discretions of the decision-maker conferred by any relevant enactment on the person who made the decision (s 43(1) of the AAT Act). Nonetheless this does not mean that the AAT is an agency head. Therefore this exception does not apply.
Does the law enforcement exception apply?
Section 355-70 provides an exception to s 355-25 where the disclosure is made to the AAT for one of the following purposes:
(a)investigating a serious offence (an offence against an Australian law that is punishable by imprisonment for a period exceeding 12 months); or
(b)enforcing a law, the contravention of which is a serious offence; or
(c)the making, or proposed or possible making, of a proceeds of crime order.
As noted a factual issue to be determined in the substantive proceedings will be whether as alleged by the Secretary, throughout the debt period Mr Khorramdel received income that he was required under social security law to declare to Centrelink.
The determination of that issue in my opinion could not be said to be for the purpose of “investigating a serious offence”. While arguably some overlap, the purpose of determining that issue in these proceedings is to enable to Tribunal to decide whether the decision to recover from Mr Khorramdel a debt of about $50,000 is the correct and preferable decision. Accordingly the s 355-70 exception does not apply.
Does the Tribunal’s general summons power override the secrecy provisions in the TAA?
The final issue to be decided is whether the power conferred on the Tribunal by s 40(1A) of the AAT Act to summon a person to produce to the Tribunal documents or things in their possession, custody or control of the person or persons named in the summons overrides s 355-25 of the Schedule.
I agree with the reasoning of DP Forgie in Rayson and Repatriation Commission [2008] AATA 1063 (at [63]) that where a secrecy provision applies to, and prevents the disclosure of, information sought, that provision cannot be overridden by the general power to summons documents conferred by s 40(1A) of the AAT Act.
Is Mr Khorramdel “the entity to whom the information relates”?
Section 355-25 of the Schedule does not apply to “the entity to whom the information relates” (s 355-25(1)(b)(ii)). It follows that if, as the Secretary alleges, Mr Khorramdel and Sivash Kheremdel are one and the same person, s 355-25 of the Schedule would not operate to prevent the ATO disclosing the requested documents to Mr Khorramdel. As Mr Khorramdel denies this allegation and that issue is yet to be determined in the substantive proceedings, it would appear that for current purposes the ATO must treat a request from Mr Khorramdel for the requested documents as a request by a person other than “the entity”, that is, Sivash Kheremdel.
Summary
Section 355-25 of the Schedule makes it an offence for an officer of the ATO to disclose protected information unless an exception contained in the TAA applies. The requested documents contain protected information. None of the relevant exceptions apply in this case. The Tribunal’s summons powers do not override s 355-25. Accordingly the applicant’s request to the Deputy Registrar to summon the ATO to produce the requested documents should be refused.
As I understand it Mr Khorramdel’s primary interest in obtaining the requested documents is to establish whether they mirror the corresponding documents held by the ATO. The Secretary may wish to give consideration to whether these concerns could be addressed by affidavit evidence setting out the process by which the relevant documents were obtained by the Secretary and reproduced in the documents lodged with the Tribunal under s 37 of the AAT Act.
I certify that the preceding 32 (thirty -two) paragraphs are a true copy of the reasons for the decision herein of Senior Member A K Britton ...................[SGD].....................................................
Associate
Dated 29 November 2013
Date(s) of hearing 1 November 2013 Applicant In person Solicitors for the Respondent Department of Human Services, Program Litigation and Review Branch
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